Tomorrow (May 21st) is the World Day for Cultural Diversity for Dialogue and Development. Adopted in 2002 by the United Nations, this day’s goal is to celebrate and deepen our understanding of diversity. For HR leaders, it’s a good time to double down on your company’s Diversity, Equity and Inclusion (DE&I) initiatives. A lot of progress has been made over the past year, with many companies nationwide reaffirming their commitment to diversity and inclusion. Though we’ve come a long way, we still have more to accomplish. To celebrate this day, we’d like to share three facts about DE&I in American companies:
1. DE&I continues to be top of mind for employers.
DE&I continues to be a key focus area for leadership teams. According to SHRM, 30% of organizations have modified, expanded, or plan to modify existing policies and systems to reduce systemic and structural bias against underrepresented employees. The same survey found that one-quarter of organizations are putting new systems in place to address this issue. According to KPMG, 96% of CEOs expect increased scrutiny of their organization’s diversity performance over the next three years.
A big reason for this shift is employee demand. Nearly 80% of employees and job seekers surveyed by CNBC said that it’s important to work for a company that values DE&I. 6 in 10 employees approve of business leaders speaking up about social and political issues more broadly. Employers such as Estee Lauder, for example, have expanded their commitments to DE&I as a direct result of employee pressure. For others, the push has come from industry leaders or customers. DE&I continues to be top of mind for employers nationwide.
2. Employees satisfied with their company’s DE&I efforts are happier.
Employees are demanding their companies invest more in DE&I, and companies that do see employees deliver better performance. In addition, employees who are satisfied with their employer’s efforts on DE&I are happier with their jobs. They are also more likely to say that they have good opportunities for advancement and feel like they are paid well. These sentiments can strengthen employee engagement and productivity.
On the other hand, employees who don’t think their company is investing adequately in their DE&I efforts report lower satisfaction overall, especially with their pay and opportunities for advancement. Such sentiments can lead to lower employee engagement and higher turnover. The link between diversity and financial performance is well-known, but we now know diversity also shapes the employee experience.
4. Employers increasingly recognize financial wellness as a key part of well-being.
More than 66% of employers offer some kind of financial wellness program, according to PwC, a 12% increase from just a few years ago. These programs have traditionally been focused on 401(k) and retirement plans but have recently included more comprehensive programs such as financial education, planning, investing, and day-to-day management of an employee’s money―with the ultimate goal of reducing financial stress and increasing financial confidence among employees.
Finances are the number one cause of stress for employees, especially for those from underrepresented backgrounds who have fewer resources and have been disproportionately affected by job losses stemming from the pandemic. These trends worsen the already large racial wealth gap in the country. Given the economic gap faced by employees from underrepresented backgrounds, employers have the opportunity to make a big impact by focusing on financial well-being in their DE&I initiatives. This includes supporting employees’ ability to overcome financial setbacks, such as reducing debt and saving for emergencies. Just as important is providing practical knowledge about building credit, planning for retirement, and growing wealth for future generations.
Inclusion plays an important role in employee engagement and well-being. You can’t have an engaged workforce without focusing on wellness, but you can’t have a wellness culture if you don’t foster inclusion and diversity. On a fundamental level, wellness is inclusiveness. As employers seek to make their workplaces more inclusive through DE&I efforts, it’s important to reflect on how quickly this topic has gone from niche to mainstream among HR and leadership teams. Yet we’re still far short of achieving our goal of a truly inclusive workplace where every employee feels respected and welcomed. True diversity, equity, and inclusivity in the workplace is about recognizing each employee’s unique background and experience and supporting them in their well-being journey.
